FED Folly. S&P 500 held the 50 DMA and closed with nearly a DOJI as if to say, "What the heck do we do now?" And that was the nature of Wednesday. But, it's also the nature of a market in correction that is changing from Bullish to Warning Phases in only 2 indexes. Russell 2000 is the other hold out besides S&P 500. When all four align, trading is easier. For now, who should we trust-DJ Industrials and NASDAQ both in warning-or the holdouts? Time will tell.
S&P 500 (SPY)As mentioned, still in bull phase. Yesterday I wrote that a low volume rally is not necessarily one to be trusted. But for now, 133.80 is pivotal and a move above Wednesday high a good sign. Subs: Today high aligns with R1.
Russell 2000 (IWM)So far, holding the gap low from 6/29 which makes this index the most compelling provided that continues to hold. Subs: R1 and today's high align
Dow (DIA) Confirmed the warning phase but with a hammer candle which means might have been forced down by sellers. In other words, over Wednesday high, would think more like worst is over.
NASDAQ 100 (QQQ) 63.50 is big-the 50 DMA, Wednesday high and for those who know, R1. Plus 2-day RSI getting oversold.
ETFs:
GLD Inside day. Watch 153.60 to break or 152 to fail
XLF (Financials) Inside day and wedged between the fast and the 50 DMAs. Over 14.50 clears the 10, under 14.35 breaks the 50 DAM.
IBB (Biotechnology) Had a good short under 130 but for a daytrade. Now, 131.50 to clear or could see 125.75
SMH (Semiconductors) Oversold on daily. No longer looking at the 3 higher lows (would have been nice), but now only a move over 31.10 would look better
XRT (Retail) 58.75 the level to hold now.
IYT (Transportation)90.85 next support- wrote yesterday. Wednesday low 90.92.
IYR (Real Estate) Closed green. No position but watching
USO (US Oil Fund)
OIH (Oil Services)Inside day
XLE (Energy) Inside day
TBT (Ultrashort Lehman 20+ Year Treasuries) 14.71 low June 1st. Today's low 14.72. Just mentioning
Longs: On categories: Gap higher days we go to all categories and choose ones with lowest risk that break the opening range. On weaker days, we look at Category 3, especially if the picks hold S1, previous day lows or a major moving average and have a good risk on the reversal. The difference between Category 1 and 2 is the stock condition-a Condition 1 is strongest stock and more likely to make a parabolic move. Note: Looking for outperformers with tightest risk (many are inside days) and over a variety of sectors
Category 1:(Aloha) Positive Phase, Condition 1, 2 days under the FTPs, Risk to Previous Day low, Can buy ½ over FTP and ½ over R1, Target- Day to at least 3 ATRs from entry: (Good if market firms)
CL Reports 7/26. 4 days under pivots has to hold 103.37 and clear 104.22-did not outperform but has a potential flag forming
FDX Inside day. Has to hold 89.92 clear today's high
UPS Inside day. Reports 7/24. Should clear 79.22 with max risk today's low
Category 2:(Pipeline) Positive Phase, Condition 2-3, 2 days under the FTPs, Risk to Previous day low, Can buy ½ over FTP and ½ over R1, Target- Day to at least 3 ATRs from entry: (Good if market firms)
EQT Reports 7/26 Accumulation Phase 2 days under the pivots and outperformed. 200 DMA great risk 52.99. Must clear 53.92 R1
AGU Inside day. Outperformed. Has to hold today's ;ow and clear today's high
COG Has to hold 39.00 and clear 40.00 Reports 7/24.
WPRT Accumulation Phase. Max risk the 200 DMA and today's low and should clear today's high
Category 3: (Double Up) Positive Phase, Condition 1 through 4, Positive Pivots which means can either buy a opening range breakout or candidate for Opening Range Reversal, with Risk S1 or previous day low, whichever is lower unless noted differently, Target- Day to at least 3 ATRs from entry: (Good if market holds)
POT Reports 7/26. Accumulation Phase-neutral pivots inside day. Outperformed. On the 200 DMA so max risk 43.80
CYH inside day. 27.22 good risk and like over 27.82 Reports 7/26
MCK Reports 7/30. Inside day. 93.36 good risk and should clear 93.90 the 10 DMA
MON Inside day. Like to see today's low hold.
Category 4: (Rip Tide) Oversold (2 or more days under FTP), Condition 1-4, Needs to clear R1, Risk previous day low unless noted differently, Target- Day to at least 3 ATRs from entry: (Only if Market is firm)
EXPE Still oversold and on the 50 DMA. Max risk today's low and must clear45.64 then 46.20
EQIX Reports 7/25. Oversold. Has to hold the 50 DMA 164.60 and clear today's high
Phase Change: TSLA Inside day. Max risk today's low which corresponds with 200 DMA PNCShould hold 60.25. Positive Pivots APC Inside day. Reports 7/23. Positive Pivots. Today's low max risk NFLXReports 7/23. 79.53 good risk Positive pivots SFLY Inside day. Positive Pivots 7/25 Reports SGY Reports 7/31. Positive pivots inside day
Shorts:
Category 5:Titanic-Bear Phase, Negative pivots, not oversold, Risk R1 or previous day high. Target: Day to swing
APA Inside day. Today's high max risk
CLR Cannot clear 67.03
MCD Like to see it stay below 90.25
AAP Cannot clear 70.74
Category 6: White Cap-Having a 2-3 Day correction over the pivots. In a Negative Phase, Positive Pivots. Can sell an Opening Range High Failure if happens below R1 or previous day high whatever is higher and/or weakness if breaks S1 and prior day's lows N/A
Bye for now!